Claims of Tort Payout ‘Surge’ Under McKenna Are Dubious, Politically-Driven

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As a Republican and the front-runner in Washington State’s race for governor, Attorney General Rob McKenna is going to receive more than his fair share of vetting from the media. The process is justified and useful – it is the primary reason that a free press is a canon of our society’s laws and values – but recent criticism of McKenna for how much has been paid out in major cases handled during his tenure in office appears to be little more than a politically-motivated attack framed around fuzzy math and sour grapes.

According to a scathing editorial published Friday in The Olympian, “Records show that McKenna has not lived up to his 2004 campaign promise to reduce the amount of money the state pays out in tort claims.”

The “records” The Olympian referred to were released to the Associated Press and reported on in a December 6th article that stated, “Washington agencies disbursed $76 million for tort claims last year – three times more than was spent the year before McKenna took office.” Though the $76 million payout figure in 2010 is not disputed, whether it constitutes a “surge” (as The Seattle Times headline proclaimed) is highly questionable.

Lawsuit payouts are a tricky budget item, fluctuating from year to year and notoriously difficult to forecast—a single-year jump is not necessarily cause to sound an alarm. After all, the basis the AP story uses in its comparison – Gregoire’s run as attorney general – contains an enormous “surge” of its own in 2001. But because the AP did not adjust the raw figures for inflation, the truth about how much payouts have increased under McKenna has been exaggerated.

According to the AP article, payouts during McKenna’s six full years in office have been $300 million, “about $70 million more than was paid out during [Gov. Christine] Gregoire’s final six years before she became governor.”

$70 million? Over six years? During a period in which the U.S. annual inflation rate varied greatly but averaged somewhere between 3.5% and 4%? Using those rates, McKenna’s payouts do not fall far off the curve set by Gregoire. Considering the resistance in Olympia to enacting and implementing the statutory and administrative reforms McKenna has sought, some might even say the state is fortunate not to have paid out more.

Aggravating the squishy math used as evidence of a payout “surge”, The Olympian went for the jugular, bringing in Office of Financial Management Risk Manager Lucy Isaki to color in the details. But in using Isaki as a source in their harsh vetting of McKenna, the AP and The Olympian neglected to vet Isaki and provide full context for her comments. In doing so, they shortchanged voters who deserve a complete picture.

Isaki – a former assistant attorney general it appears was passed over by McKenna for higher postings before landing in the spot at OFM, who – according to PDC reports – has already contributed to the campaign of Congressman Jay Inslee, McKenna’s competition in next year’s gubernatorial race – to imply that McKenna’s strategic decisions are to blame for the supposed surge in tort payouts.

From The Olympian:

“[Isaki] said it doesn’t appear that [McKenna] has established any type of creativity or overall strategy for the torts division, such as working with consultants to identify the right cases in which the state could push a sympathetic message and help establish a precedent with a smaller payout.”

In a stunning example of either journalistic cooperation or paranormal telepathy, the exact phrasing above also appears in the AP article, though the AP piece also quotes Isaki as saying:

“It would be nice to see the management of the office make something like that happen, looking at how we can effectively ask (a jury) to think about a verdict amount that will reasonably compensate, but at the same time protect the taxpayers of Washington.”

Gregoire spokesperson Karina Shagren told NW Daily Marker this afternoon that the Governor was not aware before the interviews were conducted that Isaki would comment on McKenna and tort payouts. Shagren added that Gregoire views the idea of tort reform as a “worthy effort,” but feels that it is not a “fast solution for our budget problems.”

Isaki is, of course, aware of McKenna’s dedicated push for reasonable tort reform, a development that she dismisses as politically improbable but one that would accomplish the objectives she puts forward. Nevertheless, her assessment is not entirely inaccurate – the roadblock created where trial lawyers and Democrats interests intersect is solid. The lack of will within the Democratic power structure to take action to improve things for state government is not McKenna’s burden to bear, but ironically underscores the need for a change of leadership.

Isaki must also be aware of McKenna’s push for agency reforms and accountability for bureaucrats, areas in which the muscle of the Democratic majority in Olympia have not been seen to flex. McKenna’s office has also operated with discipline and professionalism, avoiding multi-million dollar blunders such as the nearly $19 million loss to taxpayers that resulted from a missed filing deadline in 2001 when Gregoire ran the office.

State government does need to get its act together when it comes to payouts, but as McKenna has envisioned, the greatest savings will be made by improving the way government operates and giving agencies incentives to manage their own risk while still serving the public. Voters still understand the intrinsic and positive truth of that idea, even through the fuzzy numbers and the clamor of grinding axes.

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Bryan has been writing about local and national politics since 2008. In addition to writing for The Northwest Daily Marker (nwdailymarker.com) – the digital journal of politics he launched in 2011 – he has been published by American Thinker, Crosscut, Red State and the Everett Herald and explosive stories broken by The Northwest Daily Marker have generated headlines in regional, national and international major media.
Bryan is a lifelong Washingtonian and a proud University of Washington alumnus.